Northeast Kingdom Human Services will pay the state of Vermont $65,335 as part of a settlement deal resolving accusations of overbilling Vermont Medicaid and alleged neglect of a person in the organization’s adult daycare.
The agreement also requires a series of reforms that the organization will make, focused on ways the organization supervises those with developmental disabilities in its care. Those include increased training for supervisors, better prepared plans for interventions and supervision and improved communication with those involved in the care of needy adults. NKHS also agreed to work with a consultant to prepare care plans for particularly sensitive and high-need adults.
The designated agency, based in Derby, is one of the 10 non-profit groups that contracts with the state to provide services for people with developmental disabilities, mental health conditions or substance use disorders.
An investigation by the state Attorney General’s Medicaid Fraud and Residential Abuse Unit found that between June 2022 to August 2024, NKHS did not appropriately assess the risks of an adult Medicaid patient with developmental disabilities who lived in one of the community living arrangements the agency oversees.
The Attorney General’s Office found that the patient was restrained and transported in an unsafe and unauthorized vehicle and that the agency had failed to address safety concerns, despite knowing the patient was showing “escalating” and “aggressive” sexualized behavior, according to the settlement. The NKHS submitted claims to Vermont Medicaid and received $36,910 in payment for the patient’s care throughout this period.
The individual with disabilities is one of about 45 in the agency’s care for whom specific public safety funding is earmarked, according to Rebecca Silbernagel, a spokesperson for the Department of Disabilities, Aging & Independent Living (DAIL), which oversees the state partnership with NKHS.
Per the NKHS’s agreement with the Attorney General’s Office, a consultant is reviewing all of the behavior support plans for those individuals with high care needs. They have completed about a quarter of the reviews already, Silbernagel said.
She also added that those in supervisory roles at the time have since been terminated.
“It is important to note that this is a situation that occurred several years ago and is not reflective of an ongoing problem at NKHS,” Silbernagel wrote in a statement.
Separately, NKHS discovered that one therapist had been billing Medicaid for hourlong psychotherapy appointments, despite actually providing shorter sessions — an infraction called “upcoding,” which describes billing for a more expensive service than was actually performed. As a result, Medicaid paid the agency $8,425.73 more than it was owed.
NKHS self-reported the error, according to the Attorney General’s Office, and the settlement resolves it.
The settlement comes at a time when states’ Medicaid programs have faced heightened scrutiny from the federal government, surrounding fraud, waste and abuse of funds in the federal-state partnership health insurance program for those with low incomes or special qualifying needs.
In April, Vermont received letters from the director of the federal Centers for Medicare & Medicaid Services demanding that the state scrutinize the eligibility of its Medicaid care providers through a renewal process to try to weed out bad actors. In March, a congressional committee sent Vermont and nine other states a letter to interrogate their Medicaid spending.
Vermont Medicaid and state agencies look to the Attorney General’s Office fraud investigation unit as the strongest bulwark against such misuse.
“My office has been Vermont’s Medicaid Fraud Control Unit for decades and we were doing this work long before President (Donald) Trump came into office,” said Attorney General Charity Clark in a statement to VTDigger. “The federal administration’s heightened scrutiny of social safety net programs, including Medicaid, has not changed our mission to protect vulnerable Vermonters and the taxpayers’ money.”
Northeast Kingdom Human Services has faced additional allegations of Medicaid fraud. In a March lawsuit, a former NKHS employee leveled allegations that the agency incorrectly billed for services provided in its mental health urgent care.
Amelia Vath, a representative from the state Attorney General’s Office, said Monday’s settlement is unrelated to the claims the former employee raises.
